The fourth annual Prime Day event of Amazon has lured the shoppers from around the world. The event is highlighting the promotion’s evolution from a rummage sale of obscure products to 36 hours of discounts on major brands such as Samsonite luggage, Callaway golf clubs and General Mills cereals.
This event is a sharp contrast from the first Prime Day in 2015, when customers kvetched on social media about underwhelming offerings that resembled a warehouse clearance sale. This event demonstrates the leverage the e-commerce giant has when providing access to its loyal Prime subscribers who pay fees in exchange for shipping discounts, video streaming and other benefits. Many brands have decided that it is smarter to offer steep discounts and pay Amazon for advertising to win sales on the site than to sit out an event estimated to generate $3.4 billion in spending.
Procter & Gamble has offered 25 percent off Tide laundry products. Callaway Golf has offered as much as 50 percent off golf clubs and accessories and Under Armour had discounts of about 40 percent on clothing and sneakers, according to data from Boomerang Commerce, which helps brands set prices and ad pricing on the web store.
As per the CEO of Boomerang, Guru Hariharan, “The symbiotic relationship between Amazon and leading brands legitimizes Prime Day, as well as those brands serious about stepping up their e-commerce game.”
However, despite of technical glitches that hobbled the early hours of the promotion, the sales got boosted. Many shoppers were disappointed when they couldn’t add products to their carts or their attempts to search for goods prompted an error page featuring dog photos.
Amazon acknowledged the issues, but has yet to explain what caused the crash. One possibility is that the website was attacked by bots designed to snatch up deals so buyers can sell them elsewhere, or those designed to lock up inventory to protect a product’s prices on other sites, said Ben Zilberman, marketing manager at Radware, a cybersecurity company in Israel. Bot attacks are common on retail sites during big promotions, and Amazon featured a lot of “captchas” used to distinguish humans from robots during the sale, an indication it was fending off bot traffic, he said.
Zilberman said, “When traffic comes in such high volumes, it makes it difficult to run the security to distinguish between a regular customer and a bot,” Zilberman said. “A lot of traffic on retail sites is from bots, sometimes 75 percent.”
The flood of traffic is good for Amazon’s fast-growing advertising business, a profitable revenue source that supplements its low-margin e-commerce business strapped with high shipping costs. Brands and merchants buy advertising to gain prominence on the site, helping Seattle-based Amazon make more money on the popular platform. Amazon is the fourth-most popular site in the U.S., behind Google, Facebook and Google’s YouTube video service.
“Most brands increase ad spending on Prime Day,” Hull said, adding that they saw as much as a 30 percent lift in search volume and brand engagement on Google and Facebook that day as shoppers browse before making an online purchase.
Amazon said in a statement that Small businesses also got a piece of Prime Day. Amazon has millions of merchants selling goods on its marketplace, mostly small and medium-businesses that had sales exceeding $1 billion during the promotion.